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SunSirs: PE Market Continued to Decline Around Pessimistic Atmosphere

April 02 2020 11:06:16     SunSirs (Daisy)

Today (On March 31) the overall trend of the domestic PE market continues to fall. East China market LLDPE and LDPE are significantly down, while east China market HDPE was temporarily stable. The overall market transaction atmosphere is difficult to improve. As of March 31, the ex-factory average price of LLDPE 7042 in east China was 6,100 RMB/ton, down 3.68% from the previous day. The average ex-factory price of LDPE 2426H in east China is about 7050 RMB/ton, down 4.24% compared with the previous day. The average ex-factory price of HDPE 5000S in east China is 6,816.67 RMB/ton, which is more stable than the previous day. LLDPE and LDPE fall range by 200-400 RMB/ton.

On March 31, the international crude oil continued to close down sharply, and the plastic futures fell for several days in a row. The market mentality has been suppressed. The overall atmosphere of the PE market is difficult to improve. On March 31st, price still fell mainly, and petrochemical enterprises in major regions decreased by 200-400 RMB/ton or so. The market cost support continued to weaken. Businessmen continue to be pessimistic mentality, giving up positive profit to stimulate shipment. Downstream demand is less, and the purchase of small orders. There is no obvious improvement in the market, and some factories fill in as needed, more cautious wait and see. The current market atmosphere continues to be weak.

On March 31, polyethylene futures L2005 opening price 5430, the highest price 5680, the lowest price 5430, the closing price 5565, before the settlement price 5445, settlement price 5550, up 120, up 2.2%, trading volume 321784, holdings 113428, daily increase in the position – 24413 (Quotation unit: RMB/ton). 

From January to February in 2020, PE exports totaled 35,100 tons. Among them, LDPE export volume is 10,800 tons; The export volume of HDPE is 20,700 tons. The export volume of LLDPE is 0.36 million tons. From January to February, PE imported 2.365 million tons. The import volume of LLDPE is 440,500 tons. Imports of HDPE were 1.1356 million tons; LDPE import volume was 788,900 tons. 

As of February 27, the total output of domestic polyethylene enterprises was 1.41 million tons, 252,300 tons less than that of January. The output of HDPE is 578,900 tons, LDPE 206,800 tons and LLDPE 624,300 tons.

Market Forecast: The international crude oil decline and futures slump depressed the market mentality. Under the special circumstances, the downstream demand is also reduced, petrochemical sector for the most part continue to cut factory prices, with a large range. Market cost support has weakened, the downstream of the continuous wait-and-see attitude, the factory just need to take goods, and the market transaction atmosphere is difficult to improve. The short-term trend is expected to remain weak.

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